Time to Think About Year-End Investment Moves

Meet Kim Coon
Your Local Financial Advisor
Kim is a Financial Advisor with Edward Jones at 611 East Main St. in Jenks America. She works with clients to learn what is most important to them in order to develop personalized strategies for preparing for and living in retirement, life and long-term care insurance needs, and estate considerations.
Beyond having a passion for helping her clients meet their financial goals, she loves boating and lake life at Lake Tenkiller, travel, and Mexican food. Her favorite trip thus far has been whale watching in Alaska. She and her husband Danny have been married for 18 years. They have two grown sons, Jakeb and Tayler, a cat named “Bob” and a black Lab named “Duke”.
Kim looks forward to visiting with you -- she can be reached at (918) 299-1745 or
eat0@eau0eav0eaw0.

We’ve still got a couple of months left in 2018, but it’s not too soon to start thinking about some year-end investment moves that might benefit you. Here are a few possibilities (although not all will apply to your situation):

Add to your IRA. For the 2018 tax year, you can put up to $5,500 into your traditional or Roth IRA (assuming you are eligible), or $6,500 if you’re 50 or older. If you haven’t reached this limit, consider adding some money. You have until April 15, 2019, to contribute to your IRA for 2018, but why wait until the last minute?

Increase your 401(k) contributions.You already may be investing in your 401(k) or similar employer-sponsored retirement plan, but you might be able to bump up your contributions for the rest of the year, if it’s allowed. Of course, you should always put in enough to earn your employer’s matching contribution, if one is offered.

Take your RMDs. If you are 70½ or older, you must start taking withdrawals – called required minimum distributions, or RMDs – from your traditional IRA and your 401(k) or similar retirement plan. Generally, you must take these RMDs by December 31 every year. But if you turned 70½ in 2018, you can wait until April 1, 2019, until you take your first RMD. However, you will then have to take a second RMD (the one for age 71) by December 31, 2019. Taking two RMDs in one year could give you an unexpectedly large taxable income for the year, possibly bumping you into a higher tax bracket and affecting the amount of your Social Security benefits subject to taxes. So, if you are considering delaying your first RMD, consult with your tax advisor.

Make changes in response to life events.In 2018, did you experience a major life event, such as a marriage, divorce or addition of a child? Or did you change jobs or retire? Any of these events could lead you to adjust your investment plans, so now may be the time to do so, possibly with the help of a financial professional.

Review your investment mix.At least once a year, it’s a good idea to review your investment mix to ensure it’s still suitable for your goals and risk tolerance. Sometimes, even without your taking any action, your portfolio might change in ways you hadn’t expected. For example, suppose you wanted your portfolio to contain 60% stocks and 40% bonds and other investments. After a period of rising prices, though, the value of your stocks may have increased so much that they now occupy 65% of your portfolio – which means you may be taking on more risk than you had originally intended. Consequently, you may need to rebalance your portfolio to get back to your original 60% to 40% ratios. (Keep in mind that these figures are just for illustration; everyone’s ideal portfolio mix will depend on their individual situations.)

These aren’t the only year-end moves you may want to consider, but they can help you close out 2018 on a positive note. Plus, they can serve as a reminder that you need to be vigilant as you keep working toward your financial goals.